Nigeria’s oil producers target 1.2m barrels of refined capacity

Nigeria’s oil producers target 1.2m barrels of refined capacity

Thursday, August 20, 2015 9:31 am

Avuru with VP Yemi Osinbajo on Wednesday

Avuru with VP Yemi Osinbajo on Wednesday

Nigeria’s Independent Petroleum Producers Group (IPPG), said on Wednesday that the country has the capacity to refine up to 1.2 million barrels daily by the year 2020 if the government gave necessary support to operators in the industry.

IPPG made up of 20 Nigerian operators in the oil and gas industry said this after a meeting with President Muhammadu Buhari on in Abuja.

Austin Avuru, the Chief Executive Officer of Seplat Petroleum who led the group to the meeting told journalists that the issue of establishment of private refineries was one of the issues discussed with the President as the IPPG believed that Nigeria’s local refining capacity should be up to one million barrels per day by 2020.

“We actually put 1.2 million barrels domestic refining capacity per day and that falls on our doorstep as indigenous operators. It would be achieved. Some construction is already ongoing by indigenous companies and between some others who are coming in with smaller sized refineries and in partnership with NNPC. We are confident that by 2020 we will deliver 1.2 million domestic refining capacity,” Avuru said on how the feat can be achieved.

He added that the group, made up of indigenous companies responsible for production of over 200,000 barrels of oil and over 900 million cubic feet of gas production per day, want to become critical partner to government in the delivery of natural gas and other products into the domestic economy. Avuru added this is because the key segments of the oil and gas sector, especially the swamp and the onshore segment is now in the hands of Nigerian independent producers who have in the past 5 years invested over $9billion in acquiring these assets and have been investing over $1billion each year in work programme investment which he said is growing.

The Seplat Petroleum boss said it is not the intention of the indigenous operators to take over from the multinational oil companies as both group can work together in a complementary manner.

“The multinational are going into some areas which we are unlikely to go into. Deep offshore, LNG, and whereas the onshore terrain and delivery of gas to domestic market, these have become our frontiers. Though the 200,000 barrel per day production by the indigenous operators represent only about 10 per cent of Nigeria’s oil, Avuru said it is significant, given that contribution from the group to the country’s oil production was near zero just about five years ago.

“And we anticipate that in the next 5years by 2020 we will account for 30 per cent production of about 3 million barrels per day that is very significant especially when in addition to that we account for half of the total gas delivery to the domestic market. We can get as high as 7PCF per day by 2020,” he said.

“We realised we are very critical partners that he needed to know about and to engage with very early in the administration of the President. So we called for the meeting and he obliged us. Mr President was very receptive and promised that all the help and support we need to succeed as indigenous producers we will get it. Specific requests will go to the GMD when we engage him,” Avuru who said IPPG is in support of the President’s policy direction in the oil industry said.

He added that the group thought it necessary to engage the President and was happy that the Vice President, permanent secretary of Ministry of Petroleum as well as the GMD of NNPC were also present.

“So it was very useful discussion. What happened today was all parties, stakeholders and all our partners in government, which is partner to indigenous operators in government, were present at this engagement. Of course, we would now follow it up with more specifics when we meet with the GMD NNPC,” Avuru said.

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